Mortgage Delays Stall Local Homebuilder

January 23, 2008|By PETER DUJARDIN Daily Press

It's taking longer for would-be homeowners to get their mortgage loans approved these days, which in turn is affecting home builders, said Nick Turner, a vice president and co-founder of Williamsburg-based Ford Builders.

It used to take about 30 days for most customers to get their mortgage loans for custom homes to be approved, Turner said. But now it's taking about double that amount of time.

"They check all the paperwork and then recheck it," Turner said of the money lenders. "Even if you've got a relationship with a bank, they're a lot more detailed in reviewing your history ... There's no more of being able to buy more homes than you can afford. The mortgage products that are more aggressive have disappeared."

Ford Builders once expected to break ground on three or four homes in early January. Two are likely to start in February, and the others could start later, Turner said. The customers are qualified borrowers, but it's just taking more time for the banks to loan the money.

"We're just playing the waiting game," Turner said. "We're doing some more remodeling to help fill the gaps."

Ford Builders' own credit lines have remained strong, with good terms, despite the industry downturn, Turner said. He added that the company is building custom homes, not taking the risk of building without buyers.

"We saw that the market was tanking, so we were lucky," not to build many speculative homes. "But it really makes sense to buy now. There are some really good deals out there."